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New York City pensions to divest future private equity from fossil fuels

April 07, 2023

The City:

New York City’s chief financial officer announced plans Wednesday to divest the future private equity holdings of two major retirement funds from fossil fuels, making them among the first major public pensions in the nation to take the step. 

The commitment is part of a new climate plan unveiled yesterday by Comptroller Brad Lander to chart the course of the retirement systems for municipal workers and teachers – together worth $172 billion – to net zero emissions across their portfolios by 2040. Lander called it “the most ambitious plan undertaken by a U.S. public pension fund.”

The move cast a shadow on Lander’s counterpart in Albany, state Comptroller Thomas DiNapoli. In November, New York Focus reported that the state funnels public pension dollars to one of the dirtiest power plants in the country through private investments managed by private equity giant Blackstone. The state pension fund has divested from at least 55 publicly owned companies and is seen as a leader on climate risk — but it hasn’t announced any plans to clean up its private portfolio.

The nationwide movement to divest from fossil fuels has gained significant traction in recent years, but it has largely limited its attention to publicly traded companies — even as they increasingly offload their fossil fuels assets to the private market. In New York, for example, researchers estimate over 20 percent of fossil fuel power plant capacity is now owned by private equity.

[Lilah Burke]

More: New York City Pensions to Divest Future Private Equity Holdings from Fossil Fuels

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